**Executive Summary**
The Ministry of Corporate Affairs is taking steps to ease compliance for companies under the Ease of Doing Business 2.0 reforms. Key initiatives include decriminalizing technical violations, expanding fast-track merger options, enhancing the MCA21 portal, and adjusting thresholds for small companies. The enhanced thresholds for small companies, effective December 1, 2025, increase the paid-up capital limit to Rs. 10 crores and the turnover limit to Rs. 100 crores.
**Key Points / Main Content**
* **Decriminalization of Violations:**
* Technical and procedural violations under the Companies Act, 2013 have been decriminalized in two stages (2018 and 2020).
* 51 offenses under the Companies Act, 2013 and 12 offences under the LLP (Amendment) Act, 2021 have been decriminalized.
* Most offenses converted to civil defaults with monetary penalties.
* **Fast-Track Mergers:**
* The scope of fast-track mergers was expanded in February 2021 to include mergers of Start-ups with other Start-ups and with Small companies.
* Further broadened in September 2025 to allow more classes of companies to choose this route.
* "Deemed approval" introduced for timely approvals.
* **Direct Listing of Securities:**
* Indian public companies can directly list securities in permissible foreign jurisdictions.
* **Centre for Processing Accelerated Corporate Exit (C-PACE):**
* Established in May 2023 to enable hassle-free filing and timely striking off of companies' and LLPs' names from the Register.
* **Central Processing Centre (CPC):**
* Established in February 2024 for centralized processing of 12 non-Straight Through Process forms.
* **Enhanced Thresholds for Small Companies:**
* Effective December 1, 2025, the paid-up capital criteria for small companies is increased from Rs. 4 crores to Rs. 10 crores.
* Turnover criteria is increased from Rs. 40 crores to Rs. 100 crores.
* **MCA21 Portal Enhancements:**
* Version-3 (MCA21 V3) launched to streamline filings and enhance transparency.
* Includes Web filings, LLP Module, Company module, e-Book Learning Management System.
* Features real-time validation and pre-filled master data.
* Webinars, training, video tutorials, chatbot, user manuals, and FAQs are provided to stakeholders.
* A dashboard provides real-time tracking of filings and payments.
* A helpdesk addresses grievances, with MCA partnering with professional institutes for improved resolution.
* **SEBI (LODR) Regulations for Listed Entities:**
* Regulation 4 prescribes principles for disclosures and obligations.
* Regulation 17(5) requires a code of conduct for board members and senior management.
* Regulation 17(10) mandates annual performance evaluation of the board.
* **Corporate Social Responsibility (CSR):**
* CSR is a board-driven process, and eligible companies must file Form CSR-2.
* **Data Analytics in MCA21 V3:**
* Includes Early Warning System (EWS) and Compliance Management System (CMS).
**Impact Analysis**
**Small Companies**
* **Impact:** Benefit from reduced compliance requirements due to increased threshold limits.
* **Action Required:** Understand the new threshold criteria effective December 1, 2025, and adjust compliance procedures accordingly.
**Indian Public Companies**
* **Impact:** Have the opportunity to directly list securities in permissible foreign jurisdictions.
* **Action Required:** Evaluate the benefits and requirements for direct listing in foreign jurisdictions.
**Stakeholders Filing with MCA**
* **Impact:** Experience streamlined filings and enhanced transparency through MCA21 V3.
* **Action Required:** Utilize the resources provided (webinars, tutorials, dashboard, helpdesk) to familiarize themselves with the updated MCA21 portal and processes.
**Listed Entities**
* **Impact:** Subject to SEBI (LODR) regulations promoting ethical governance and board accountability.
* **Action Required:** Ensure compliance with regulations related to disclosures, code of conduct, and board performance evaluation.
Key Entities Referenced
Companies Act, 2013: The primary legislation undergoing decriminalization and other amendments.
Ease of Doing Business 2.0: The overarching reform initiative that the described changes are part of.
Ministry of Corporate Affairs: The government body responsible for the initiatives described.
Jan Vishwas (Amendment of Provisions) Act, 2023: Act that decriminalized 183 provisions across 42 Central Acts.
MCA21: An e-governance initiative of the Ministry of Corporate Affairs
Ministry of Corporate Affairs
Ministry of Corporate Affairs taking timely steps
to ease compliance burden on the corporates
under Ease of Doing Business 2.0 reforms
Thresholds for small company enhanced to reduce burden of
compliances with effect from December 1, 2025; paid-capital
criteria increased from upto Rs. 4 crores to upto Rs. 10 crores
and turnover criteria increased from upto Rs. 40 crores to
upto Rs. 100 crores
प्रव तथ: 16 DEC 2025 6:09PM by PIB Delhi
The Ministry of Corporate Affairs has been taking the following key steps from time to time to ease the
compliance burden on the corporates:
i. De-criminalization of technical & procedural violations under Companies Act, 2013 has been done in
two stages (in the year 2018 and year 2020) through amendments in such Act. As a result, 51 offences
under the Companies Act, 2013 have been decriminalised. Further, vide LLP (Amendment) Act, 2021, 12
offences have been decriminalised. Most of such offences have been converted into civil defaults to be
adjudicated by levy of monetary penalties. This has reduced the burden on criminal courts & National
Company Law Tribunal.
ii. The scope of fast-track mergers was expanded in February 2021 to allow mergers of Start-ups with
other Start-ups and with Small companies. The ambit has been further broadened in September 2025 to
allow more classes of companies to choose this route. Further, “deemed approval” has been introduced for
fast-track mergers to ensure that approvals are given in a time-bound manner.
iii. Direct listing of securities by Indian public companies in permissible foreign jurisdictions has been
allowed. This is a boost for “Brand India” and increases attractiveness to growing technology sector,
stimulates efficiency & growth, provides alternative source of capital and broadens investor base.
iv. The Centre for Processing Accelerated Corporate Exit (C-PACE) was established in May 2023 enabling
the stakeholders by providing a hassle-free filing, timely and process-bound striking off their companies’
and LLPs’ names from the Register.
v. The Central Processing Centre (CPC) was established in February 2024 for centralized processing of 12
non-Straight Through Process forms.
vi. With effect from 1st December 2025, the thresholds for small company have been enhanced. The paid-
capital criteria has been increased from upto Rs. 4 crores to upto Rs. 10 crore and turnover criteria has
been increased from upto Rs. 40 crores to upto Rs. 100 crores. This brings more number of companies
under the definition of small company, which are subject to lesser compliance requirements in comparison
to larger companies.In addition, the Government has focused on further decriminalization to enhance Ease of Living and Ease
of Doing Business. This includes the Jan Vishwas (Amendment of Provisions) Act, 2023, which
decriminalized 183 provisions across 42 Central Acts. Under the initiative to reduce compliance burden,
Central Ministries/Departments and States/UTs have successfully reduced over 47,000 compliances
through self-identification exercises by way of simplification, digitization, decriminalization and
redundancy removal.
Version-3 of MCA21 (MCA21 V3) has been launched to promote Ease of Doing Business, strengthen
compliance and enhance transparency and streamline corporate filings. Through MCA21 V3,
functionalities like Web filings, LLP Module, Company module, e-Book Learning Management System
have been implemented. All filings are now being made through this system, which provides for real time
validation with pre-filled master data reducing manual errors, re-submissions and compliance timelines.
In addition to the above, following steps were taken so that the stakeholders get familiarised with the
filing requirements, while at the same time, providing them a mechanism for resolving their grievances:-
i. Webinars and training are conducted regularly for handholding stakeholders. Video tutorials, Chatbot,
user manuals and FAQs are available on portal to assist users in filing of returns.
ii. The portal provides a dashboard facility that enables stakeholders to track filings, payment status, and
approvals in real time, thereby enhancing transparency.
iii. A helpdesk mechanism has been established to address grievances related to the MCA21 portal. To
further improve grievance redressal, MCA has partnered with professional institutes to review ticket
closures. A dedicated team from these institutes works closely with MCA to monitor grievance handling
and collect user feedback after ticket closure.
For listed entities, the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
(“LODR”), promote ethical governance and board accountability through comprehensive provisions
focusing on disclosures and responsibilities of the Board of Directors. The key provisions are as under:
i. Regulation 4 of the LODR prescribes the principles governing disclosures and obligations of every
listed entity and its Board of Directors. These include the rights of shareholders, timely dissemination of
information, equitable treatment, transparency etc.
ii. Regulation 17(5) of the LODR requires Board of Directors to lay down a code of conduct for all
members of board of directors and senior management of the listed entity. The code of conduct also
suitably incorporate the duties of independent directors as laid down in the Companies Act, 2013. All
members of the Board of Directors and senior management personnel are required to affirm compliance
with the code of conduct of board of directors and senior management on an annual basis.
iii. Regulation 17(10) of the LODR mandates a formal, annual performance evaluation of the entire board,
which shall include- (a) performance of the directors; and (b) fulfilment of the independence criteria as
specified in these regulations and their independence from the management.
In the above evaluation, the directors who are subject to evaluation shall not participate. The Nomination
and Remuneration Committee (NRC) of the Board is responsible for formulation of criteria for evaluation
of performance of independent directors and the Board of Directors.
Under the Act, CSR is a Board driven process and the Board of the company is empowered to plan,
decide, execute and monitor CSR activities based on the recommendations of its CSR Committee. CSR
eligible companies are required to file Form CSR-2 to report CSR related disclosures. All data related to
CSR filed by companies in MCA21 registry is available in public domain and can be accessed at
www.csr.gov.in.Data analytics-driven features have been integrated in MCA21 V3 including enforcement and compliance
modules. These include Early Warning System (EWS) and Compliance Management System (CMS)
which use risk-based classification of companies and filings, automated generation of alerts and exception
reports, pattern analysis of non-compliance.
This information was given by the Minister of State in the Ministry of Corporate Affairs; and the Minister
of State in the Ministry of Road, Transport and Highways, Shri Harsh Malhotra in a written reply to a
question in Rajya Sabha today.
***
NB/ONP
(रलीज़ आईडी: 2204766) आगंतुक पटल : 1892
इस वज्ञ को इन भाषाओ ंम पढ़: ही , Punjabi